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Which statement is true about IRAs? If withdrawals are made from an IRS before age 59 1/2, the person must pay a 10% penalty plus taxes on the amount of money withdrawn O IRAs are designed to help rich people make more money and avoid paying taxes on money while working or after retirement O An IRA account is made up of the stock from the bankwhere the person has the account By encouraging people to save for retirement through IRAs, the governemtn is saving millions of dollars in Social Security What is the major difference between a traditional IRA and a Roth IRA? o Contributions to a Roth IRA are only tax deductible if a person earns under $50,000 a year, contributions to a traditional IRA are completely tax deductible Earnings from a roth IRA are never taxed, whereas withdrawals from a traditional IRA are taxed O Roth IRAs do not start earning incomeuntil a person retires, traditional IRAs start eaming tax deferred income after a person reaches the age of 59 1/2 Roth IRAs are made up of mutual funds, traditional IRAs are made op of CD How does a person who is planning to retire in 30 years benefit now from making contributions to the employer's retirement plan? They contributions to the company's retirement plan now mars that they will not have to contribute to Social Security in the future o Emolovers retum employees pension contributions in the form of annual bonuses Yearly contributions to the planne tax deductible; therefore they reduce the amount of income on which they to tanes The sooner they start contributing to the plan the one they can start withdrawing the money without un to pay penalty Diversification is the practice of buying several different assets to increase the chance of earning money, DT O False With variable interest, payments remain the same for the life of the loan True False